Malabar Steamship Co. Ltd. vs Dara Kilikar and Others

Nandana Menon, J.—This second appeal is by the 1st Defendant in the suit. The circumstances leading to this appeal are as follows: The Plaintiffs are merchants carrying on business in Mattancherry Bazaar. A consignment of 70 cases of foreign liquor was shipped by a firm called T, Motandas and Co, in 1948 as per Jagadamba, a steamer belonging to the first Defendant company, to the Plaintiffs. The steamer arrived at the Port of Cochin on 21-5-1948. According to the Plaintiffs when the cases were delivered it was found that the consignment was short of 15 bottles of brandy and 17 bottles of whisky. A survey was got conducted by Lloyd''s Agents according to whose report the shortage was clue to breakage in handling in transit and pilferage.

Hence the Plaintiffs preferred a claim for the cost of the part of the consignment so found short of as well as proportionate freight charges and gal age ice. The Defendant company contended that were not liable. According to the company were rebounded at Bombay due to prior breakages and clauses in the bill of lading specifically stipulated that tire steamship company was not responsible for any breakages or shortages. The trial Court found that tire shortage complained of was true and the clause in the bill of lading intended to exonerate the steamship company from any liability for breakage or shortage was a void one as the same contended the provisions of Carriage of Goods by Sea,'' Act. Hence the Plaintiffs'' claim was upheld.

In the appeal preferred by the Steamship Company before the District Judge of Anjikaimal the findings of the trial Court were upheld. If is against those'' concurrent findings that the company has now, come here in appeal. On behalf of the Appellant is contended that there is no evidence to support that'' finding that there was short delivery of goods, that the lower Courts were wrong in holding that the" clause in tile bill of lading exempting the company from liability for breakage or shortage was invalid, and the interpretation placed upon the provisions of the Carriage of Goods by Sea Act is not correct.

As regards the question of shortage what is urged on behalf of the Appellant is that there was , no proper consideration of the evidence by the lower appellate Court, the Court proceeding on the assumption that the shortage complained of was not disputed. In view of the statement in the judgment of the learned Additional Judge it is clear that this issue was not seriously pressed there. Further it is not correct to say that there is no evidence to support the finding on that point. What D. W. 1 says is that shortage was not likely. The bill of lading, namely,. Ex. I, refers to 70 cases of brandy and whisky.

The number of bottles is not mentioned. This is emphasized on behalf of the first Defendant. Ex.'' A which is the survey report of the Lloyd''s Agents-shows that they calculated the contents at the rate of 12 bottles per case. Ex. C (1) shows that the consign or calculated the price on that basis. D.W. 1" does not say that the procedure adopted by the Lloyd''s Agents on the basis of each case containing: 12 bottles was unwarranted. P.W. 1 is the person'' who prepared Ex A and deposes to the cases being; of standard packing & his calculation being based upon the said basis. So the finding regarding the short delivery cannot be questioned.

The main question for consideration is whether the special conditions incorporated in the bill of lading exonerate the carrier company from'' any liability. The endorsement relied upon by the company is the typed portion below the tabulars ip: Ex. I being as follows:

All cases rebounded. N.R. for breakage and shortage of contents. Three cases broken before shipment and repaired.

While on behalf of the Defendant it is contended'' that this condition effectively discharges them from any liability with regard to short delivery what ''is urged by the Plaintiff is that the bill of lading being; governed by the Indian Carriage of Goods by Sea. Act such a clause cannot protect the company, Ex. I in the margin the applicability of the Carriage of Goods by Sea Act is specifically referred to. In Indian Carriage of Goods by Sea Act, 2,6/1925, Article 3 deals with, the responsibilities and liabilities of a carrier. Rule 3 therein is as follows.

After receiving the goods into'' his charge, the carrier, or the master or agent of the carrier shall, on demand of the shipper, issue to the shipper a bill of lading showing among other things (a) The landing marks necessary for identification of the goods as the same are furnished in writing by the shipper before the loading of such goods starts:

Provided such marks are stamped or otherwise shown clearly upon the goods if uncovered, Or on the cases or covering in which such goods are contained, in such a manner as should ordinarily remain legible until the end of the voyage;

(b) Either the number of packages or prices or ''the quantity or weight, as the case may be, as furnished in writing by the shipper;

(c) The apparent order and condition of the goods:

Provided that no carrier, master or agent of the carrier, shall be bound to state or show in the bill of lading any marks, number, quantity or weight which he has reasonable grounds for suspecting not accurately to represent the goods actually received, or which he has had no reasonable means of checking.

Rule 4 says that a bill of lading so granted shall be prima facie evidence of the receipt by the carrier of the; , goods therein described. Hide 5 is to the effect that the shipper shall be deemed to have guaranteed to the carrier the accuracy of the statement! made by him and that shipper shall be liable for any loss caused to the carrier resulting from any inaccuracies in particulars given though the said right of the carrier shall nut limit his liability under the contract of carriage to any person other than the shipper. Rule 7 deals with the issue, of a "Shipped" bill of lading. Then 11. 8 which is a crucial one is as follows:

Any clause, covenant or agreement in a contract of carriage relieving the can for or the; ship from liability for loss or damage lo or in connection with the goods arising from negligence, or failure in the duties and obligations provided in this Article or lessening such liability otherwise than as provided in these rules, shall'' be mill A benefit of insurance or similar clause shall be deemed to be a clause relieving the carrier from liability.

The question is whether in the present case the ''typed endorsement relied upon by the carrier company'' is affected by this clause. An identical provision exists in the English Carriage of Goods by Sea Act, 1924, on the basis of which the Indian Act was drafted. In Carver''s Carriage of Goods by Sea Act (9th Edition) dealing with the said rule it Is observed as follows:

It has been suggested that the effect of the rule may be to make the offending clause totally void, but where the rules are expressly incorporated an the bill of lading it is submitted that their effect is to get down the provisions of an offending clause only in so far as it is repugnant to the rules and that the clause as so limited is effective on the ground that it does Article 3, Rule 8. On this view a wide exception clause in a ''receipt for shipment'' bill of lading which expressly incorporates the Hagen rule will be effective before, shipment of goods. Where, however, the rules are only''. applied by virtue of Section 1 of the Carriage of Goods'' by Sea Act, 1924, tire effect of Article 3, Rule 8 might well be'' to make such an exception clause totally 4 void.

Dealing with the scheme of the Act in the Carver''s1 Treatise it is observed as follows at page 166:

As a consequence of these statutory liabilities of ship-owners being made irreducible the interests of endorsees of bills of lading who are not parties to the contract for the carriage of goods by sea are protected.

Exceptional cases where the Carriage of Goods '' by Sea Act does not apply are (1) where the goods to be carried are not included in the statutory definition in Article 1 of the Rules in the Schedule to the Act, i.e., where they are live animals, or cargo which, by the contract of carriage is stated as being carried on deck, and is so carried, (2) where goods are carried in the coasting trade otherwise than under a bill of lading (Section 4 of the Act and. Article 6 of the Rules) (3) where any particular goods are carried under a special agreement embodied in a receipt which is it non-negotiable document and is marked as such, no bill of lading being issued, and ordinary '' commercial shipments made in the ordinary course of trade being expressly excluded from this head of exception.

In the present case as the bill of lading had been'' issued and the transaction is not covered by any of the exceptions contemplated under the Carriage of Goods by Sea Act the provisions in Article 3 are fully applicable. The Carriage of Goods by Sea Act was enacted on identical lines in many countries as a result of an International internee. The circumstances leading to it are pointed out at page 45 of Payne''s Carriage of Goods by Sea (5th Edition) being as follows:

In 1922 an international conference was held al. Brussels with the object of scouring adoption by the countries represented of a set of rules relating., to bills of hiding so that the rights and liabilities of , cargo owners and ship-owners respectively might be subject to a set of rules of general application. Previously, those lights and liabilities had been differently defined in different countries with consequent embarrassment to overseas trade.

In England the Act is of 1924. The Indian Act of 26 of 1925. In the erstwhile Cochin State a simila Act was passed as Act 59 of 1.112 (M.E.). In the aforesaid Payne�s Treatise at page 47 dealing with the question of contracting out of the Act it is observed as follows:

The Act of 1924 was intended mainly to protect holders of bills of lading, by ensuring to then certain rights of which they could not be deprived! It was, therefore, laid down that in cases to which the Act applies the carrier should be able to avoid liability only in certain circumstances defined in the Act. In general the extent of the carrier''s immunity, as laid down by the Act, cannot be increased by contract; any clause or contract purporting to relieve a carrier of his liabilities under the Act is expressly declared to be void and of no effect.

On behalf of the Appellant exemption from liability is claimed on the basis of the typed endorsement in the bill of lading. From what is pointed out above in view of the fact that Carriage of Goods by Sea Act applied it is clear that surely an exemption cannot be claimed. Orient Ship Supply Co. v. Kalamarsand Co., Steam Ship Co. AIR 1951 Ker 1 (A), '' cited on behalf of the Appellant does not Apply to the facts of this case. What is pointed out by the Appellant''s counsel is that there also the words "S. N. R. for breakage and leakage" were stamped on the bill of lading, and the Court held that there was no liability. There at p. 12 it is stated that S. N. R." stood for the words "Steamer Not Responsible."

In view of the existence of that clause it was held that the carrier was not liable because in that particular case the Carriage of Goods by Sea Act did not apply as the cargo in question was contracted to be carried on deck. In the Act, Article 1, definition (c) shows that goods to which the Act applied excluded cargo which by the contract of carriage was treated as being carried on deck and was so carried. Hence there is no need of dealing with the discussion of law there.

Coming to the other decisions relied upon by the Appellant''s counsel in Pohumal Brothers v. Karachi Port Trust AIR 1925 Sit 221 (B), there was a special clause in the bill of lading exonerating the carriers from any liability with regard to difference in marks in the goods delivered. The claim against the carrier was rejected on the ground that there was no proof that all the goods entrusted had the particular mark in. question. The provision in the Carriage of Goods by Sea Act is not even referred to. In Paihwal v. New Bombay Steamship Co., AIR 1911 Mad 7 (sic), also the question was whether the goods delivered were of a. different kind.

Relying upon a clause in the effect that "weight, contents shipped is unknown." that here are deficient by Lloyd''s Agents is to pilferage and breakage, Biitish India Lines Steamship. (C), also deals with difference in marks decisions are not of much help to the Appellant.

On the other hand, Malabar Steamship Co. Ltd. v. Hossain Kasem Dada, ILR (1951) 1 Cal 650 (D), is a decision in full, support of the Respondent. There in a similar claim the defence was that the bill of lading contained a clause absolving the carrier company from any liability for loss and also on the ground that on the bill of lading there was an I'' endorsement similar to the one here being to the p following effect:

Drums old and dented. S. N. R. for breakage '' and leakage and for obliteration of marks.

Relying upon Article 3, Rule 8 and Article 4, Rule2 (q) of the Carriage of Goods by Sea Act it was held that no exoneration can be claimed. The following observe bill of lading to and value when claim was rejected. The result of the survey the effect that here was Ahaincdali v. Holland 1984 Shut 85 these vations there beginning from page 652 may be pointed out:

As under sub-rule (q) the onus of disproving negligence and privities is placed expressly upon the carrier and there is no "attempt in the present case, now before me; to discharge that onus placed upon the carrier, it must be held that the carrier shall be responsible for loss or damage.

lire expression "Any other cause" appearing in Sub-rule (q) cannot be interpreted as being ejusdem generis to sub-Rules (a) to (p) as it is difficult to imagine any genus which would embrace them all. These words should therefore be given a wider interpretation and to avoid his responsibility the carrier can prove that neither he nor his servants were at fault. The exception as mentioned in condition 2 of the bill of lading clearly contravenes the provisions contained in Rule 8 of Article 3 read with Rule 2 of Article 4 of the schedule to the Carriage of Goods by Sea Act. The liability of the Carrier has to be determined on die basis that condition No. 2 in the bill of lading has not been imposed or agreed upon between the parties.

Regarding the endorsement on the bill this is what is observed:

It is however further contended that the Mate''s report appearing on Ex. XI disentitles the consignee from claiming any damages. Without going into the question whether the endorsement bearing on the bill of lading is admissible or not as the original bill has not been produced which is admittedly with the Commissioners of the Port of Calcutta the exception made in the endorsement is limited to breakage & leakage. The finding of the Court below, however, is that the drums had been cut open and the coconut oil pilfered. The claim founded on pilferage is not excepted by the endorsement, even if such endorsement be held to be admissible in evidence.

It must, therefore, be held that the Defendant: Steamship Co., is liable for loss occasioned by pilferage during the transit from Cochin to Calcutta.'''' In the present case Lloyd''s survey report shows that one bottle was broken, the cause of it being given as due to handling in transit and 31, bottles missing considered as due to uncharged. The endorsement in Ex. I refer to breakage and shortage. It was urged on behalf of the Appellant that in view of the above facts the Appellant Company is entitled to exoneration. I do not see hew the endorsement can stand on a different footing than the printed clause'' in the bill of lading.

Article 3, Rule 8 hits the endorsement as effectively as it hits any printed clause. The responsibility of the carrier to deliver the goods "in the like good order and condition" was always there. The endorsement relied on is not sufficient to show that the goods were not in good order. The reference to cases being rebanded does not mean that the number of bottles in each was less than the normal contents of such cases.

So it is clear that in view of Article 3, Rule 8 of the Carriage of Goods by Sea Act the carrier was liable to indemnify the consignee as now held by the lower Courts. The liability extends to that of proportionate gallonage and freight also. So the relevant law has been rightly interpreted by the lower Courts and no ground for interference arises in this second appeal.

In the result, the appeal is dismissed with costs.